According to the December 14 2012 issue of US New & World Report, nearly two-thirds of the U.S. Budget goes to payments of entitlements, social security, welfare, etc.  In 1960 that amount was less than one-third.  One of the biggest problems has been congress’s unwillingness to properly deal with entitlements.  At that rate our annual federal budget will, in the not too distant future, have 90% going out to various entitlement programs.  That fact is, we simply cannot afford to continue at this rate.  We have got to come to terms with the fact that we cannot be all things to all people.

Since its inception, social security has been the one entitlement program where Americans have contributed a portion of their income into it.  But the problem is, that money is not banked but used as funding for other federal programs.  This should be the first, and easiest, program to fix.  While I do not agree with the Republican plan to privatize social security, I do believe that the government should take that revenue stream, and through a dozen or so investment firms, set aside this money for future use.  Although I do not know, I suspect there is some federal law that prohibits such transactions at this point.  That can be cured by Congress passing a law that allows for the investment of social security revenue alone into private investment firms.  This would not resolve the short-term problems of social security funding, it would most definitely help in the long-term.

The next entitlement program that needs tackling is welfare and its various programs.  I think this program can be reigned in by turning over most of the program’s management and fund distribution to the various states.  Each state would be responsible for identifying individuals eligible for welfare.  They would also contribute, say 20%, to the funding of the program.  That all by itself should help with accountability in the programs.  Each month every state would submit a listing of those eligible to start receiving, or continue receiving, welfare benefits.  The federal government would in turn issue the checks.  But each state would be responsible for food subsidies to include who is eligible and how the program is administered in their states.  That state would submit its annual welfare budget to the federal government for payment.

We also need to end all forms of corporate welfare, particularly oil subsidies and farm subsidies.  The farm subsidy started in the late 1930s when the federal government needed to reign-in what and how much of any particular crop was grown.  Farmers, for example, had been growing wheat on land that could no long support the crop and driving down prices to a point where few people made a profit.  But since the 1950s, and the evolution of modern farming techniques, American farmers are much more responsible with what and how they grow their crops.  Farm subsidies are an anachronism and need to end now.

Where oil subsidies are concerned, Republicans claim that ending them will necessarily drive up the price of gasoline.  In the short-term, they are probably correct, but in the long-term market forces will help set reasonable prices.

Democrats need to take a much more pragmatic view of America’s entitlement programs if we are to ever get some control over the federal budget and the federal debt.  And for their part, Republicans need to moderate their demands away from the draconian and towards a form that conservatives and liberals alike can work with.